Fair Trade: How to Brew Justice

At Equal Exchange, countercultural thinking comes naturally. Employees ride bicycles and trains to pickup spots to minimize auto emissions en route to company headquarters in an industrial park in West Bridgewater. The office wing resembles a college dormitory: tapestries cover walls, posters plead for peace, an acoustic guitar sits atop the desk of Rob Everts, Dickinson's copresident and a former organizer of California farmworkers. As a matter of policy, top management earns no more than three times the salary of entry-level employees, who start at around $25,000 a year. After a probationary period, all employees own one share of voting stock in the company, which gives each an equal say in key policy decisions.

But to fulfill their social mission, staff members rely on shrewd business acumen and a few key premises. First, they trust that consumers are willing to pay a little more to help family farmers, especially if the coffee in their cup is extraordinarily tasty. They keep costs down by eliminating middlemen whenever possible. And they defy industry norms by lending cash to farmers prior to harvest. That move aims to breed loyalty, eco-friendly harvesting techniques and uncompromised bean quality.

Despite Equal Exchange's efforts, there's still a long way to go before coffee growers will have a fair deal. Serious problems persist for coffee producers in developing nations. Commodity prices have languished well below $1 per lb. for much of the past two decades, so crops have often been sold at a loss, leading many families to abandon their farms for a better life in the cities. "It's forcing families who have depended on coffee for income into destitution," says Matthew Aho, who is producing a documentary on Fair Trade's impact on Peruvian farmers.

Fair Trade isn't a panacea for coffee growers' difficulties. Uneducated farmers sometimes don't understand why their cooperative has made certain decisions with their dollars, for example, according to Todd Caspersen, director of purchasing at Equal Exchange. What's more, the cooperative movement is still just developing, so big companies say they have to buy from brokers as well. "A company of our level couldn't find all we need from cooperatives," says Dub Hay, senior vice president of coffee and global procurement at Starbucks.

In the meantime, Equal Exchange is pursuing new ways to do good business. The company is exploring produce markets in what would be a bid to show that squeezing local fruit and vegetable vendors for rock-bottom prices isn't the only way to run a profitable business. In fact, their vendors might be the ones ready to do the squeezing--with hugs of gratitude.